February 13, 2017

Daily Market Commentary



Economic News:

  • European stocks rose in a broad rally, approaching their highest level since December 2015, as increasing copper prices boosted the shares of basic-resources companies. The Stoxx 600 finished last week with a 0.9 percent gain amid a slew of positive earnings results and better-than-expected export data from China.
  • Global stocks continued a rally before data this week provides detail on the strength of U.S. consumer prices, and ahead of speeches from a range of Federal Reserve officials. Treasuries fell after data showed America’s biggest creditors ditching holdings.



  • Metals: Gold: 1230.26 (-$3.36, -0.27%), Silver: 17.96 (+$0.01, +0.04%); Copper: 2.7880 (+0.72%); Aluminum: 0.8501 (+0.03%); Nickel: 4.8776 (+0.88%); Zinc: 1.3388 (+0.95%)
  • Energy: Crude: 53.47 (-0.72%); Brent: 56.27 (-0.76%); Nat Gas: 2.97 (-2.18%)
  • A rally in copper and iron-prices helped push Asian equities to the highest since July 2015 as Chinese stocks listed in Hong Kong outperformed the region. Japanese shares rose after a positive meeting between Prime Minister Shinzo Abe and U.S. President Donald Trump.
  • Oil fell in New York, snapping a three-day gain on signs that OPEC’s production cuts will stimulate a recovery in U.S. crude production. Futures lost as much as 1.1 percent in New York after advancing 3.2 percent over the previous three sessions.
  • Gold retreats as Asian equities follow U.S. stocks higher after S&P 500 Index rises to record Friday, hurting demand for haven assets. Iron ore surged and copper climbed, buoying commodity producers.



  • Canadian Prime Minister Justin Trudeau and U.S. President Donald Trump will meet for the first time today as the new administration’s protectionist push threatens $541 billion in annual trade between the countries.
  • Canada and the U.S. have knitted together one of the world’s most integrated economies since signing free trade agreements 30 years ago, trading everything from fertilizer to oil, auto parts to drugs. As Prime Minister Justin Trudeau heads to Washington to meet President Donald Trump Monday, Canadian companies are hoping it doesn’t all unravel in a trade war.
  • Thomson Reuters Corp., the news and information provider, reported fourth-quarter profit that missed analysts’ estimates as revenue slid and it posted a charge of $212 million after it reduced its headcount. Earnings excluding some items fell to 31 cents a share.


United States:

  • Federal Reserve Chair Janet Yellen probably won’t drop a heavy hint on the timing of the next interest-rate increase when she speaks to Congress this week, but expect her to defend post-crisis banking rules the Trump administration has sworn to undo.
  • Freeport-McMoRan Inc. suspended copper concentrate output at its giant Grasberg complex in Indonesia as the company continues to negotiate with the government over the terms of its mining permit. Local unit PT Freeport Indonesia halted output at its copper mill Friday, Tri Puspital, a member of the industrial relations department at Grasberg’s labor union.
  • The dollar rose as attention shifted to Donald Trump’s promised tax plan after the U.S. president refrained from criticizing Japan’s currency policy at meetings with Prime Minister Shinzo Abe. The greenback strengthened against most of its Group-of-10 peers and Treasury yields rose after the two leaders delegated discussions on monetary policy, cooperative projects and trade to their deputies.



  • Walt Disney Co. plans to take full ownership of its ailing theme park in Paris to get the resort under control after 25 years of ups and downs at its first and only outlet in Europe. Disney is acquiring a 9 percent stake in Euro Disney SCA from Saudi Prince Alwaleed Bin Talal’s Kingdom Holding Co. for 2 euros ($2.13) a share, payable in Disney stock. That will give it an 85.7 percent holding, and it’s offering the same price in cash for the rest.
  • The head of the union at the world’s biggest copper mine says he’s never seen owner BHP Billiton Ltd. this reluctant to cede ground over wages. That’s why he’s preparing for a long strike. Patricio Tapia, the president of Escondida’s main union, is overseeing construction of a workers’ camp outside the mine that’s designed to last at least two months.
  • China is asking companies this month to estimate the highest duties they can bear, according to people familiar with the matter, as the nation prepares for possible punitive U.S. tariffs. Government departments are also asking Chinese companies that have large trade volumes with the U.S. to evaluate the impact should the U.S. label the nation a currency manipulator.
  • Elon Musk may think hydrogen-powered vehicles are rubbish, but Toyota Motor Corp. and a cadre of Japan’s leading manufacturers are betting otherwise — and not just on cars. With the blessing of Prime Minister Shinzo Abe, Toyota is at the forefront of Japan’s efforts to use hydrogen and fuel cells to power cars, heat homes and keep factories running. Other companies pursuing the technology include Panasonic Corp., Toshiba Corp. and JX Nippon Oil & Energy Corp.
  • China’s three biggest bitcoin exchanges took steps to prevent withdrawals of the cryptocurrency amid pressure from the nation’s central bank to clamp down on capital outflows. BTC China subjected all bitcoin withdrawals to a 72-hour review, while Huobi and OKCoin suspended them completely, the three venues said in separate statements on Thursday.
  • Heineken NV agreed to buy Kirin Holdings Co.’s Brazilian beer business for 664 million euros ($706 million), creating a stronger No. 2 in the South American country behind clear market leader Anheuser Busch-InBev NV.
  • Nigeria plans to sell some assets over the next four years to generate as much as $16.4 billion to reduce the burden on the public budget, a Budget Ministry document showed. Nigeria estimates its economy contracted 1.5 percent in 2016, partly because of a decline in the price and output of oil, the country’s biggest export and revenue generator.
  • Royal Bank of Scotland Group Plc is preparing to cut more than 1 billion pounds ($1.25 billion) of annual operating costs by eliminating jobs and closing branches as it seeks to bolster profitability, said a person with knowledge of the plans.
  • Teva Pharmaceutical Industries Ltd., the world’s largest maker of generic medicines, reported fourth-quarter profit that exceeded analysts’ estimates. Profit excluding some costs rose to $1.38 a share last quarter, the Petach Tikva, Israel-based company said in a statement on Monday.
  • China’s central bank restarted the use of an instrument that adds cash to the financial system, helping ease liquidity concerns before $153 billion of funds come due this week.



*All sources from Bloomberg unless otherwise specified